In the first half of this year, Dividend Fund was a "top student" in the market. However, since the significant rebound of A-shares at the end of September, the momentum of the dividend sector's rise has been clearly insufficient, and multiple dividend funds have experienced significant pullbacks. As market risk appetite increases, the attractiveness of defensive dividends is lower than that of pro cyclical and technology growth sectors. The reporter noticed that several dividend fund managers actively adjusted their positions and exchanged shares in the third quarter, exiting bank and utility stocks that had already risen sharply in the early stage, and allocating their positions to electronics, computers, and military industries in search of greater returns. At the end of September, driven by unexpected macroeconomic policy stimulus and optimistic sentiment, the A-share market rebounded significantly. However, several funds have withdrawn more than 10% in the past month, and even some dividend funds have withdrawn more than 20% in the year. As of November 2nd, the Huatai Bairui Dividend ETF, which has a scale of 17.99 billion yuan, has experienced a drawdown of 13.61%. Compared with the drawdown in the dividend sector, Huatai Bairui Fund Manager Liu Jun believes that although dividend assets are not as explosive as other varieties with strong growth attributes, they still show a trend of "defending the strong and attacking not weak". If the debt policy can be effectively implemented in the future, it will permanently improve the asset quality and corporate value of our holdings. Of course, when we made the buying decision initially, our basis was not this optimistic expectation, but rather the assumption that if the most pessimistic scenario occurred, the buying price would still have a sufficient margin of safety, which is also the reason why we dared to hold heavy positions Jiang Cheng and Wang Tao, fund managers of Zhongtai Asset Management, said. Liu Yong and Zhang Xueming, fund managers of China Europe Fund, pointed out the risk of dividends, stating that the dividend style has experienced continuous outperformance in the market in the third quarter, as well as a significant short-term pullback. Any industry or style, if there is a large influx of funds, will cause an amplification of volatility and risk. Even if the dividend strategy itself is a low volatility, low beta style, excessive crowding and fanatical pursuit of funds will still cause the original characteristics of the style to be lost, which is a risk that investors need to pay extra attention to. Since September, some fund managers have shifted their positions and exchanged shares. Dividend funds have underperformed the market. After reviewing the third quarter reports of funds, reporters found that many dividend fund managers have intensively shifted their positions and exchanged shares, selling off individual stocks such as utilities and banks that rose sharply in the first half of the year, in search of growth stocks with higher winning rates. Taking Lin Nian, the fund manager of ICBC Credit Suisse Fund, as an example, the overall position of ICBC dividends managed by him remained high in the third quarter. In terms of sector allocation, firstly, against the backdrop of signs of weakening global manufacturing PMI sentiment, the portfolio has reduced its allocation ratio to resource stocks. Secondly, in the stable defense sector, on the one hand, considering the significant excess returns of bank stocks since the beginning of the year and the pressure of narrowing interest margins, the portfolio has reduced its holdings in bank stocks; On the other hand, Lin Nian has also reduced the allocation ratio in the public utility sector. In the consumer sector, the combination continues to focus on home appliances as the key configuration direction. Considering that the prosperity of Baijiu industry is still under pressure, the portfolio reduced its holdings of Baijiu that was tentatively allocated in the previous quarter, and looked for opportunities in food and beverage stocks other than Baijiu. In addition, the portfolio has also appropriately increased the allocation of automotive stocks that benefit from policy support Lin Nian said. The dividend returns managed by Zou Yun, the fund manager of Xinda Australia Asia Fund, are allocated along two main lines: "domestic demand recovery" and "new quality growth". Zou Yun believes that for the "domestic demand recovery" line, due to the severe pressure of this cycle, even if monetary and fiscal forces are simultaneously exerted, it is difficult to return to the era of skyrocketing housing prices in the past. Therefore, we should not have overly high expectations for the recovery slope. Therefore, the main configuration of the recovery line is in the retail banks, essential consumption, service consumption, and a few hidden champions in traditional industries that have suffered a lot in the past, enjoying the dividend period of increasing market share and reversing difficulties; For the "new quality growth" line, high-quality companies with relatively balanced allocation in pharmaceuticals, new energy, electronics, computers, and military industries can enjoy the dividend period of new quality productivity transformation and upgrading. The Zhonghai Dividend Growth Hybrid Fund managed by Qiu Hongli has increased its holdings in some electronic, computer, mechanical and other related products. We are not pessimistic about the medium to long term trend of the market, and there will still be significant differentiation in the future trends between sectors and individual stocks. We will focus more on technology products that can continue to grow in the medium to long term and high dividend products that are undervalued, "said Qiu Hongli. Fund managers are still optimistic about the opportunities in the fourth quarter. When looking forward to the market situation in the fourth quarter, Liu Jun said that the defensive attribute of dividend strategy will still be a "safe haven" for funds. In the medium term, against the backdrop of a new round of fiscal efforts, the dividend strategy has been heavily allocated to sectors related to stable growth such as infrastructure, once again becoming an important lever for both offensive and defensive targets. Low dividend investment has the characteristic of crossing cycles to a certain extent, but the absolute return is still highly correlated with the overall beta of the market, and the relative return has a certain degree of insufficient attack when the growth style is strong. Therefore, overlaying indicators on the basic dividend strategy for repair or enhancement is a direction worth considering. We can consider the low wave dividend as a dividend enhancement strategy that superimposes low wave factors. From the perspective of earning relative returns, the low wave dividend strategy appropriately improves the risk characteristics of the high beta high wave basic dividend strategy Liu Jun stated. Tang Yibing, a fund manager at Boshi Fund, believes that although short-term market expectations have significantly reversed, it takes some time from the introduction of policies to their effects. Unless there are further unexpected stimulus policies in the future, there should not be excessive expectations for the rapid short-term increase in corporate profits. Dividend related assets are mainly cyclical sectors, and their performance also has great elasticity in the early stages of economic recovery. For example, the increase in dividend assets in 2007, 2009, and 2014 was not low. Considering that the dividend style represented by CSI dividends is currently at a historical high, with potential profit growth and dividend rate growth space, the allocation value of dividend assets in the fourth quarter is still worth paying attention to, especially from a historical perspective, the probability of value style dominance is high in November and December, "said Tang Yibing. Liu Xingyu, fund manager of Yongying Fund, said that the macro environment in the fourth quarter is still relatively low, with corporate profits bottoming out and macro liquidity relatively loose. From the perspective of the cycle quadrant, the clock model predicts that it is in the early stage of recovery. However, unlike previous cycles, the current observed situation is that the Chinese economy is in a stage of structural adjustment and shifting between new and old driving forces. The time at the bottom of this macro cycle may be longer than before, and the slope of economic recovery is relatively slow. It is unlikely that A-share profits will show significant improvement in the short term. But more positive factors are brewing, with a significant increase in the strength of a package of policies such as monetary, fiscal, and industrial policies, and policy synergy. The cycle and effectiveness of their implementation are expected to further improve, and the market is likely to have already emerged from the most pessimistic stage, with the possibility of fluctuating upwards in the future. There are opportunities for both trends and structures. (New Society)